Trump agrees to pay $25 million to settle Trump University lawsuits

Reuters

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By Karen Freifeld and Dan Levine

NEW YORK/SAN DIEGO (Reuters) - Donald Trump agreed on Friday to pay $25 million to settle fraud lawsuits over his Trump University real estate seminars, in what New York's attorney general called a "stunning reversal" for the U.S. president-elect.

The lawsuits had dogged Trump, who denied any wrongdoing, throughout his campaign. They led to one of the more controversial moments of his run when he claimed the judge overseeing two of the cases was biased because he was of Mexican ancestry.

The settlement was announced by New York Attorney General Eric Schneiderman, who said it followed repeated refusals by Trump "to settle for even modest amounts of compensation for the victims of his phony university."

Lawyers for Trump had argued against students, who claimed they were they were lured by false promises into paying up to $35,000 to learn Trump's real estate investing "secrets" from his "hand-picked" instructors.

Three lawsuits relating to Trump University will be covered by the deal: two class actions suits in California and a New York case brought by Schneiderman. The agreement must still be approved by U.S. District Judge Gonzalo Curiel in San Diego.

Trump will not admit any wrongdoing under the agreement. His attorney, Daniel Petrocelli, acknowledged Trump had previously vowed to fight the case.

The settlement demonstrated Trump's desire to set his personal feelings aside in order to work on issues facing the county, Petrocelli said.

"Today's $25 million settlement agreement is a stunning reversal by Donald Trump and a major victory for the over 6,000 victims of his fraudulent university," Schneiderman said in a statement.

At a court hearing on Friday, students' attorney Jason Forge said that out of the $25 million proposed settlement, $4 million will be earmarked for students represented by Schneiderman who were not part of the California class actions, as well as administrative costs.

Class action lawyers for the students will not seek attorneys fees, but reimbursement for costs, he said.

Curiel, who is presiding over the two California cases, had urged both sides to settle. Trump said during his election campaign that Curiel, who was born in Indiana to Mexican immigrant parents, could not be impartial because of Trump's campaign pledge to build a wall on the U.S.-Mexico border to control illegal immigration.

In court on Friday, Trump lawyer Petrocelli praised Curiel for his hard work on the case.

Curiel said he hoped the settlement could be part of a healing process after the U.S. election "that this country very sorely needs."

(Reporting by Karen Freifeld in New York and Dan Levine in San Diego; Editing by Bernadette Baum and Tom Brown)